Richardson v. Western Home Insurance — 29 N.Y. St. Rep. 820

Majority

p. 820

Harry A. Richardson and Horace W. Miller, App’lts, v. The Western Home Ins. Co., Resp’t.

(Supreme Court, General Term, Second Department,

Filed February 10, 1890.)

Headnote

Corporations—Service—Appointment op agent.

Defendant, desiring to do business in this state, sent to plaintiffs a statement of its affairs and appointment of the superintendent of the insurance department as its agent to receive service of process. Plaintiffs filed the statement with the superintendent, upon which he refused to permit the defendant to do business here and application therefor was subsequently withdrawn. Thereafter the plaintiffs filed the appointment and served the summons in this action upon the superintendent. Held, that the appointment never became operative and that the service of summons was properly set aside.

Appeal from order vacating service of summons.

The defendant is an insurance company incorporated under the laws of Iowa, and is not and never has been engaged in business in this state. The plaintiffs are insurance agents and brokers engaged in business in New York city. In July, 1888, the plaintiffs wrote to the defendant making a proposition to procure the admission of the defendant to do insurance business in this state. In consequence of that letter the defendant prepared a statement of its affairs for submission to the superintendent of the insurance department of this state, and also an appointment of the superintendent as its attorney to receive service of process against the company in actions in New York, the appointment being dated August 23, 1888, and sent the two papers to the plaintiffs. The plaintiffs filed the statement with the superintendent before October 2,1888. Upon that statement he refused to admit the defendant to do business in the state.

p. 821

On or about December 7th the defendant, by letter, notified the superintendent that it had decided to withdraw its application for admission to the state and requested a return of the statement and other papers forwarded to him. To that letter he made answer, refusing the request upon the ground that the withdrawal of papers of that nature, filed in the department, was not allowed.

On Hoveniber 20, 1888, the plaintiffs presented to the defendant a statement of their claim against the defendant. That claim became the subject of controversy between the parties. After the controversy had arisen, and after the plaintiffs had received knowledge of the defendant’s withdrawal of its application to the superintendent, the plaintiffs, on December 31st, filed the appointment of attorney with the superintendent, and did so with the intent and for the purpose of serving the summons in this action upon him. They made the service on January 5, 1889.

Grove M. Harwood, for app’lts; Douglas & Minton, for resp’t.

The appointment of the superintendent of the insurance department by the defendant as its attorney to receive service of process never became operative. By chapter 346, Laws of 1884, such appointment was necessary in case foreign insurance companies did business in this state. The appointment was preliminary to such application and the application was withdrawn by the defendant before the power was filed. The plaintiffs, who were the agents and attorneys for the defendant, filed the power and promised that the other papers would be filed. The application was registered, and it was not until after the defendant failed to pay the plaintiffs that they filed the power as stated. The power was filed December 29, 1888, and this action was commenced January 5, 1889. The power never became operative. It was conditioned upon a license from the insurance department, which was never granted, and it was filed after the application had been refused and for the purpose of service in this action. Ho one has been deceived thereby. The plaintiffs were the actors in the application and knew of its inchoate character.

The order setting aside the service should therefore be affirmed, with costs.

The power of attorney executed by defendants conferring on the superintendent of insurance the right to receive process for defendant was placed in the hands of plaintiffs to be used for the benefit of defendants and to enable them by complying with the law in that respect to transact business in the state of Hew Tork. Thereafter the defendants abandoned the purpose of transacting business in this state.

The plaintiffs were presumptively aware of that fact, and the filing by them of the power of attorney in the office of the superintendent of insurance was manifestly done, not to further the interests and plans of defendants, but to enable plaintiffs to sue them in this jurisdiction.

p. 822

Such, use of the power of attorney was unwarranted, and the plaintiffs should, not be allowed to hold a service thus obtained.

Order affirmed, with ten dollars costs and disbursements.